Did you know that transit benefits can save money for both employees and employers? The Transit Benefit program allows employees to pay for transit through pretax dollars. Savings from Transit Benefits can be significant, and participating is easy for everyone.

For the Employee:

Would you like to save up to $1,000 a year? Using Ventra’s pre-tax transit benefit program can save you up to 40% on your commuting! Transit Benefits allows you to set aside money for travel on CTA, Pace and Metra, lowering your taxes and easing your commute. Each month, the funds are deposited into your Ventra Account, ready to use.

Contact your Human Resources department to learn more about this great program!

For the Employer:

Ventra’s pre-tax transit benefit program is a great way to extend a money-saving benefit to your employees at no cost to you. Employees who participate in the CTA / Ventra Transit Benefit program don’t have to pay income taxes on the pretax income they set aside for their commute, saving up to 40% per month for each employee on their commuting expenses, and employers can save on FICA and unemployment tax – almost 8%! Ventra’s pre-tax transit benefits program is offered free of charge (unlike other Third Party Administrators), and can be used to fund transit on CTA, Pace and Metra (through the Ventra app).

What are Transit Benefits?

The IRS created a program to extend tax-free benefits to assist with employee’s commuting costs.

The Transit Benefit Program is an employee benefit program administered by employers. It allows employees to pay for their transit rides using pre-tax dollars – up to $255 per month ($3,060/year).

Because of the pretax nature of the program, savings for employees can be as much as 40 percent and employers can realize about an 8 percent payback.

The program is based on a federal tax law designed to encourage the use of public transit. An amendment enacted under the Transportation Equity Act for the 21st Century (TEA-21) expanded the definition of the Qualified Transportation Fringe provision of the Internal Revenue Code, Section 132(f).

How It Works

Employers have the option of subsidizing employees' transit costs at a level of their choice, or designating a portion of an employee’s pretax income to pay for transit. The outcome is a reduction of taxes for employees and employers, regardless of the level of subsidization by the employer.

Each month between the 5th and 20th (the Load Window) you will be able to add new employees or make changes to your employees’ reload amounts. The monthly loads will be placed in your employees’ Ventra Accounts before the end the month.

Benefits

Employer Benefits

Provide tax savings for employers (up to 8% of what employees spend on transit)

Is easily managed

Can serve as a recruiting tool

Improve morale and reduce absenteeism

Increase productivity

Have a positive environmental impact

Employee Benefits

Provide tax savings for employees (up to 40% of their transit costs)

Reduce employee commuting costs

Reduce car costs (gas, wear and tear, insurance, etc.)

Reduces the stress of driving and finding parking by making riding public transportation easier

Employer Q&A

Q: How many employees do I need to sign up for Ventra transit benefits?

A: There is no minimum. Your company can sign up for transit benefits with just one employee.

Q: My employees use CTA, Pace and Metra. Can Ventra pre-tax transit benefits help all of them?

A: Yes! Employees can use Ventra to pay fares on CTA and Pace, and Metra riders can download the Ventra app to purchase Metra Monthly Tickets.

Each month the employee’s deduction will be loaded into their Ventra Account to use on CTA and Pace, or to purchase their Metra Mobile Tickets – no more trips to ticket windows or vending machines! The app is available for both Android and iOS devices.

Q: What are the current monthly tax-free allowable limits?

A: With Ventra Transit Benefit employees can set aside up to $255 a month for transit/commuting use.

Q: What’s the difference between an employer subsidy and a pre-tax deduction?

A: An employer subsidy is an employer-paid benefit, whereas, a pre-tax deduction is a payroll deduction made by employees. Transit benefits can be offered as either a subsidy, pre-tax payroll deduction or a combination of both.

Due to the tax advantages, offering the benefit as a subsidy is more cost effective when employers are considering giving an employee the equivalent raise in salary. For example, a monthly transit subsidy of $250 is roughly equivalent to a $406 pay raise which would be taxable income. A subsidy saves the employer on payroll taxes and the employee on having to pay additional taxes on a higher income. Pre-tax deductions must be tracked via your payroll system.

Even if your company offers a transit subsidy, your employees may still benefit from a pre-tax deduction. You can do either a subsidy or a pre-tax deduction, or a combination of the two, through the Ventra Transit-Benefits program. Just select the load amount for each employee and submit.

Q: Can my employees get their benefits automatically each month?

A: Yes, employees can set up a recurring reorder of either transit value or CTA and Pace 30-Day Passes. Employees just need to set up their monthly deduction and Ventra handles the rest. The only time anyone would need to log back in is to make a change to or suspend their withholding.

Q: Do I need to keep detailed tax records?

A: No. Unlike Flexible Spending Accounts (FSAs), no complex record keeping is required for commuter benefits. There is no special IRS reporting, such as W-2 or 1099 statements.

Q: Do I have to wait for open enrollment to sign up for Ventra Transit Benefits or make changes?

A: No! Employers can sign up for Ventra Transit Benefits at any time and employees can make changes to their withholding at any time of the year.

Q: How long would it take to set up my company’s own CTA Ventra Transit Benefit program?

A: Please allow 7-10 business days for your request to be processed and funding source to be confirmed. New accounts are typically ready to be used the following month.

Q: Can employees redeem transit benefits for cash?

A: No. Under the Ventra transit benefits program refunds are only credited back the employer and only if the employee moves out-of-state.